... everyone just printed their money?

Doesn't it sound great? Whenever you need money you just walk to your computer and print a couple thousand euros. You would never have to work again, and instead of your everyday instant ramen you can now feast on Michelin-Star level food from the most expensive restaurants. But what if I told you it wouldn't really work like that?

The big problem is, that money bases its value, like all other things, on availability and need. If there are 500 pigs for sale, but the people only want to buy 200, the price sinks. On the other side, if there are 1000 people looking to buy pigs, the price of the pigs would skyrocket. Money is only able to maintain its value because the amount of money that's circulating in our pockets and bank accounts is not changing rapidly, so we can be sure that it will be accepted by whomever we want to buy something from.

When everyone suddenly starts printing their own money, the money would lose basically all of its value, since no one would ever need it, because they can just print it themselves. This event is called 'hyperinflation' and has already happened multiple times in history. From 1914 to 1923 the German Reichsbank printed an absurd amount of new mark bills. Like other banks, it had supported the state during the war by lending money to the state and therefore preventing the taxes from being raised. Until the end of 1923, there were 196.5 quintillion marks printed, and the mark was at one trillionth of its 1914 value. One American dollar was quoted at 4.2 trillion marks, and basically everything costed literal mountains of money. Since the money wasn't worth anything anymore, children were playing with it outside, not sand, not pebbles, we're talking about bundles of mark bills.

But what if it was only you printing money? Then the whole story would be different. Even if you would be printing money 24/7, you would be struggling to reach 0.1% of the money that's legally being printed anyway. The money you would gain would greatly outweigh the minimal loss of value that the money would suffer over time. This is one of the reasons why counterfeiting money is sadly very popular. Of course, countries and banks continously work on ways to make their money safer against counterfeiting, to avoid things like this happening. However there are still hundreds of thousands of counterfeit bills being found and taken out of circulation every year. It is a constant race between legal forces and counterfeiters.

I hope you liked today's article of our 'What if...' thought experiments.